Seattle’s top venture capital firm hopes to lure talent from tech giants with new startup accelerator

A group photo from Madrona’s first “Go Vertical” startup ideation workshop. The firm ended up investing in the winning idea. (Photo via Madrona)

Silicon Valley tech giants like Facebook, Google, Uber, Salesforce and others have helped expand Seattle’s overall tech ecosystem with their big remote engineering offices in a region already home to Amazon and Microsoft. But this trend has also hurt the growth of the startup community, sucking up entrepreneurial talent and potential founders that can create new companies.

Madrona Venture Labs CEO Mike Fridgen. (Photo via Madrona)

Now Seattle’s top venture capital firm wants to tap into that talent and cast a wider net for potential investments with a new accelerator.

Madrona Venture Group is launching a startup accelerator this summer operated by Madrona Venture Labs, the firm’s internal “startup studio,” which takes ideas and turns them into companies by way of recruiting, product development, financial investment, and more.

The 3-month accelerator will mimic the studio, but with a focus on already-established teams. Accepted startups will use Madrona Venture Labs resources — expertise in company creation, design, engineering, etc.; access to Madrona’s advisor and investor network; and more. It will be housed in Madrona’s new 20,000 square-foot floor that opens later this summer underneath its existing downtown Seattle office.

“We already have this in place, but instead of [just] working with founders, we’ll also be working with startups to help them accelerate their business,” said Mike Fridgen, CEO of Madrona Venture Labs.

The first company in Madrona Venture Labs’ accelerator will come out of its Machine Learning Startup Creation Weekend this May. The winning team from the hackathon-style event will have the opportunity to take a $ 100,000 investment from Madrona Venture Labs and spend the next three months in its new accelerator.

Madrona Venture Labs held two similarevents in the past and ended up investing in the winning companies.

“We have a track record of doing this,” Fridgen said. “This event is making it more formal.”

Fridgen said he’s been blown away by the talented people attending these events, particularly senior engineers, product leaders, and other employees from larger companies in the area that may be interested in joining a startup. There’s demand from these workers who want to get plugged into the Seattle startup scene, he said.

“The biggest motivation for the accelerator is the talent participating in our weekend startup creation events,” Fridgen said. “That signaled to us that we needed a path, not just in a weekend, to get those amazing talented potential founders to quit their day job and go do this for real.”

Added Fridgen: “We have significant presence from the five most valuable tech companies in the world here in our own backyard. This is a special opportunity for Seattle. These events and this accelerator are trying to bring those people into startups.”

Inside Madrona Venture Labs. (Photo via Madrona)

Many of the accelerator details — equity stakes, funding provided, number of companies in a cohort; number of cohorts per year; etc. — are still being sorted out, Fridgen said. The accelerator will focus on companies working in machine learning and AI; blockchain and cryptocurrency infrastructure; and voice interfaces for the enterprise. It will also consider companies that fit within Madrona’s overall investment themes.

This summer the firm will double its footprint with the new space, a combination of a co-working area, startup studio, event center, and more, housing Madrona portfolio companies as well as outside startups. Madrona Venture Labs will be the anchor tenant in the new space.

Fridgen doesn’t expect the accelerator to change how Madrona Venture Group makes its own investments, separate from Madrona Venture Labs.

“There are a bunch of companies funded over the last three years at the seed and Series A stage that weren’t a fit for Labs, that were a fit for Madrona Venture Group,” he noted. “With the accelerator, I don’t see anything changing. It’s just creating new opportunities for teams that are early in their process, to help them get to the next level.”

In Seattle, there’s also Techstars, which operates a similar 3-month accelerator that provides $ 120,000 in funding to each startup and access to the organization’s global network.

“We’re delighted to see more different flavors of support for high-performing founders here in the Pacific Northwest, from the many “studio” / incubator models that have popped up lately, to Madrona’s many efforts to support the ecosystem,” said Techstars Seattle Managing Director Chris DeVore. “Madrona is a long-time investor and supporter of Techstars Seattle, so we think of them as a partner, not a competitor.”

Fridgen agreed, noting that “this is incremental.”

“These are all creating more opportunities for this rich talent base we have in Seattle,” he added.